On 16 October the governor of Kirov region signed law No. 2-ZO, the second amendment this year to the region’s budget law for 2026 — both the federal legal register and the new law’s own list of prior publications show exactly one earlier change, July’s. It was adopted by the Legislative Assembly on 15 October and published on 20 October. Its shortest provision does the most work: the line under which the region had reserved money “for the indexation of the wages of employees of regional state and municipal institutions” is declared no longer in force. All three redactions involved — the base law No. 450-ZO of 18 December 2025, the July amendment No. 524-ZO and the new law — are official scans without a text layer. We read both amending laws in full, the relevant articles of the base law, and the main-characteristics, revenue and section-level expenditure appendices in both the July and October redactions, and recomputed every figure this article states.
One line erased
The base law, in part 7 of article 4, reserved appropriations under the subsection “Other general state questions”:
“1) for the indexation of the wages of employees of regional state and municipal institutions in 2026, in the amount of 4,212,069.5 thousand roubles”.
The July amendment replaced 4,212,069.5 with 1,567,628.7 — a cut of 2,644,440.8 thousand roubles, 63% of the reserve. The October law finishes the job in one line:
“in part 7: point 1 shall be recognised as having lost force”.
The trajectory of the one budget line that existed to protect public-sector pay from inflation, across ten months: 4.2 billion roubles in December, 1.6 billion in July, nothing in October. Its neighbours in the same part survive: the master-plan line is untouched, and the reserve for obligations under federal transfer agreements is trimmed from 12,940.6 to 11,740.6 thousand roubles.
A reservation is not a payment, and the law is explicit about that: part 7’s own closing paragraph lets the regional government distribute the reserved money to actual spenders by its own decisions, without touching the law. What the redactions record is therefore the legal commitment, not the roubles paid — and the commitment is gone.
What the rest of the law does
The amending text of law No. 2-ZO makes exactly five other replacements. The appropriation for paying court judgments against the region goes from 77,492.4 down to 64,459.9 thousand roubles — a line the December law set at 20,778.7 and July had nearly quadrupled. The reserve fund of the regional government goes up from 200,000.0 to 332,000.0 thousand roubles, a 66% rise. And the ceiling on the region’s state internal debt rises on all three dates it is set for: from 26,776,938.7 to 28,139,942.3 thousand roubles at 1 January 2027, from 25,336,147.7 to 26,699,151.4 at 1 January 2028, and from 20,944,674.9 to 22,307,678.5 at 1 January 2029 — an increase of 1,363,003.6 thousand roubles on the first and third dates and 1,363,003.7 on the second, or 1.363 billion roubles on each.
The July amendment had moved those same ceilings the other way, cutting them from the December law’s 29,641,829.5 / 28,631,524.6 / 24,240,051.7. October hands back less than half of July’s reduction. One line it does not touch: the appropriation for servicing the debt stays at 842,000.0 thousand roubles, where July set it after cutting it from 870,000.0.
The main characteristics in appendix 1 show what the ceiling is for. Revenues for 2026 fall by 65,933.1 thousand roubles, to 116,364,175.3. Expenditures rise by 1,364,289.3 thousand, to 118,937,139.3. The deficit goes from 1,142,741.6 to 2,572,964.0 thousand roubles — 2.25 times the July figure. The subtraction closes exactly. With revenues flat, the whole of the new spending is financed by the enlarged right to borrow. The three headline figures for 2027 and 2028 are unchanged.
Where the room went
The law gives no reasons — regional budget amendments carry no explanatory note when published. But comparing the section-level expenditure appendix of the July and October redactions shows where the money moved, and the fourteen sections reconcile with the headline change exactly:
| section | change, thousand roubles |
|---|---|
| General state questions | −1,420,349.9 |
| Social policy | +1,133,609.4 |
| General-purpose transfers to municipalities | +761,472.4 |
| Education | +485,814.4 |
| All other sections, net | +403,743.0 |
| Total | +1,364,289.3 |
The fall in “general state questions” is where the erased reserve was parked: the subsection that held it loses 1,630,666.7 thousand roubles — slightly more than the 1,567,628.7 that was still reserved — while the reserve-funds subsection inside the same section gains the 132,000.0 the government’s own fund received. The largest single gainer inside social policy is the subsection “social security of the population”, up 879,256.4 thousand roubles.
Revenue was recomposed as much as it was cut. The total of tax and non-tax revenue is identical in both redactions to the tenth of a thousand roubles — 77,232,860.1 — but inside it the profit-tax forecast rises 586,845.0 while excises fall 737,145.3, with personal income tax unchanged. The whole of the net revenue fall sits in transfers from other budgets, which go from 39,197,248.3 to 39,131,315.2.
The same line, two more budgets
Kirov is not the only region that reached for the pay reserve this month. It is the third to take from that line in acts signed on 15 and 16 October alone.
On 15 October the government of Tomsk region issued decree No. 225p, published on 20 October. It moves 787,287.0 thousand roubles off the line “Raising the pay of public-sector workers (reserve)” and puts the identical sum onto “Servicing the state internal debt of Tomsk region”; the table’s total column reads 0.0. Its second appendix swaps the instrument the region borrows with: the plan for placing 6,500,000.0 thousand roubles of regional bonds is cancelled and replaced, rouble for rouble, by credit from commercial banks. The volume of borrowing does not change; the lender does, two and a half months before year-end. Why, the decree does not say — what it records is the change of instrument, not the reason for it.
And on 16 October the government of Arkhangelsk region issued decree No. 791-pp, published on 19 October. It takes 64,435,000.00 roubles off “Reserve funds for raising the pay of public-sector workers” and gives 57,600,000.00 to the regional government’s own reserve fund and 6,835,000.00 to the one-off payment to residents who go to the war — by signing a military-service contract, by joining a volunteer formation, or on call-up by mobilisation. The two additions equal the subtraction to the rouble.
Both decrees cite part 11 of article 15 of federal law No. 431-FZ, the 2026 special rule that lets a regional government rewrite its spending schedule without amending the budget law — the power whose grounds list, ending in purposes the region defines for itself, we took apart in the Khakassia piece two days ago. Kirov did not need it: it changed the law itself.
Why this is about the ability to pay for the war
A region short of money has four moves: cut spending, borrow, ask the centre, or not pay. In one law Kirov wrote down two of them — it erased a spending commitment that can be deferred without a default, the indexation of public-sector pay, and it enlarged its right to borrow by 1.363 billion roubles on every date the ceiling is set for. The deficit it plans for this year is now 2.25 times what it planned in July, financed not by new revenue but by new debt.
What makes the week legible is that three regions, in three different instruments — a law, a schedule decree, a schedule decree — reached for the same line, and in all three it is the donor. The recipients differ, and they are a map of what currently outranks public-sector pay: in Tomsk, the cost of carrying debt, which needed 787 million roubles more than its appropriation held, inside an approved schedule; in Arkhangelsk, the government’s discretionary reserve and the payments that recruit men to the front; in Kirov, a package of social and municipal spending paid for with borrowed money. Our annual inflation indicator reads 6.3% year on year for September. Indexation is the mechanism that moves public wages with prices, and these reserves were the money set aside to do it. In one of the three budgets that reserve is now legally extinct; in the other two it is smaller by the sums the decrees state, out of totals they do not.
The debt side has its own signal. Tomsk’s swap arrives in a market where the federal government itself is borrowing at 2026-record yields; whether the region tried to place its bonds first, the decree does not say. Kirov raised its ceiling while leaving the debt-service appropriation unchanged at 842,000.0 thousand roubles — when the new borrowing happens and what it costs is written nowhere in the law. This is the pattern we documented last week in Khanty-Mansi, which raised its deficit 65% and funds it with bonds and bank credit, and in Rostov, which raised its deficit a third time this year. Around them stand the deferral of 300 billion roubles of budget-credit repayments, treasury credit opened to every region and a floor under regional grants: the centre keeps adjusting the plumbing, and the regions keep arriving at the same two moves — borrow more, pay people later.
What this changes in our model
Nothing today, by construction. The consolidated regional budget balance scores 33 out of 100, with a rolling twelve-month reading of −1.466 trillion roubles against a pre-war anchor of the 2021 surplus of +0.661 trillion and a registered trouble line at −2.5 trillion. These are planning documents: a deficit written into a law moves our series only when it becomes execution data in the Treasury’s reporting. The strength index stands at 46 out of 100, in the stress zone. No reading moved in today’s data update; all eight are on the monitor, and how the consolidated regional balance is measured is set out in the guide.
What the law-level record adds is direction. A region that erases its indexation reserve and raises its borrowing ceiling in the same act is telling you which way its share of that consolidated balance is pointed before the execution data arrives.
What we do not know
Why. None of the three acts states a reason for any of its movements. Kirov’s published law runs to 639 pages of scans, most of them restated appendices; we read the main-characteristics, revenue and section-level appendices, not the programme-level ones, so which programmes the social-policy increase funds is not something we can name.
Whether any indexation was actually paid. The law reserves money and un-reserves it; distributions the government made from the reserve before July, if any, would not appear in these redactions. We can say the legal commitment to index is gone. We cannot say whether, or by how much, anyone’s pay was raised first.
How much was in Tomsk’s reserve. Decree No. 225p names the sum taken, not the line’s total — so whether 787,287.0 thousand roubles emptied the reserve or dented it is not in the document. Nor does anything in it say whether a bond placement was attempted before the programme was swapped for bank credit.
What remains on Arkhangelsk’s line. Same gap: the decree names the subtraction, not the balance. And it does not state the size of the one-off enlistment payment per person, so how many contracts 6,835,000.00 roubles covers cannot be derived from it.
Whether Kirov’s 2027–2028 plans moved beneath the headline. The three main-characteristics figures for both planning years are unchanged, but the appendix distributing those years’ spending by section is restated, and at least one line in it differs between the redactions — national security for 2027 rises 10,989.0 thousand roubles. We did not reconcile the whole of it, so we do not claim the planning years are untouched beyond appendix 1.
What the new borrowing will cost. The ceiling rises 1.363 billion roubles; the debt-service appropriation does not move. At what rate the region expects to borrow, and when, is in neither the law nor anything published with it.